the auto worker who won the lottery after his plant almost closed, but kept coming to work every day. and bought flags for his whole town. and one of the cars he built to surprise his wife, he gives me hope. the family business in minnesota that didn't lay off a single one of their 4,000 employees when the recession hit. even when their competitors shut down dozens of plants. even when it met the owner gave up some perks and some pay. because they understood that their biggest asset was the community and the workers who had helped build that business. they give me hope.

i think about the young sailor i met at walter reed hospital. still recovering from a grenade attack, that will cause him to have his leg amputated above the knee. six months ago we would watch him walk into a withohite house dinner honoring those who serve in iraq, tall and 20 pounsds ds heavier, dashing in his uniform, with a big grin on his face, sturdy on his new leg. i remember how a few months after that i would watch him on a bicycle racing with his fellow wounded warriors on a sparkling spring day. inspiring other heroes who had just begun the hard path he had traveled. he gives me hope. he gives me hope. i don't know what party these men and women belong to. i don't know if they'll vote for me.

but i know that their spirit defines us. they remind me in the words of scripture that "ours is a future filled with hope and if you fill that faith with me, if you share that hope with me, i ask you tonight for your vote. if you reject the notion that this nation's promise is reserved for the few, your voice must be heard in this election. if you reject the notion that our government is forever beholden to the highest bidder, you need to stand up in this election. if you believe that new plants and factories can dot our landscape, that new energy can power our future, that new schools can provide ladders of opportunity to this nation of dreamers, if you believe in a country where everyone gets a fair shot and everyone does their fair share and everyone

plays by the same rules, then i need you to vote this november. america, i never said this journey would be easy, and i won't promise that now. yes, our path is harder, but it leads to a better place. yes, our road is longer, but we travel it together. we don't turn back. we leave no one behind. we pull each other up. we draw strength from our victories and we learn from our mistakes, but we keep our eyes fixed on that distant horizon, knowing that providence is with us and we're surely blessed to be citizens of the greatest nation on earth. thank you. god bless you. and god bless these united states.

♪ >> the president wrapping up his acceptance speech for the nomination for president of the united states. democratic party. in charlotte, north carolina. can be described, perhaps, as a more subdued speech than the one that he gave at his initial convention four years ago. still touching on topics that are very popular. among his base. you had the tax issue, you had the issues of education. there were references to the automobile bailout. but still, john harwood who's with us, and larry kudlow still with us, and we have more guests coming in in a moment. there were parts that were surprising at times. opening up more land for natural

gas drilling. we talk about tax reform. we talk about defense and strong on foreign policy. larry kudlow, did you feel this was a more centrist speech than you expected? >> no, not particularly. i mean, he said he was looking at the principles of bowles/simpson and simpson/bowles that those principles included pro growth tax reform across the board, getting rid of the deduction. he opposes that. he wants to raise taxes on the well to do. he demagogued on the middle class tax cut as did mr. biden. he sort of said, you know, government is not always the problem. you know what, government in my opinion is frequently the problem. government gets in the way of commerce, government gets in the way of investment, government gets in the way of success and the rate of return. he's a man of government. i didn't see anything different today. he's still a man of government and republicans who oppose that, they're going to hurt the poor, the elderly, the disabled, and they're going to have dirty air. i just don't agree with him, i'm

sorry, i'm not in his camp. >> you know, john harwood, it seemed like the only big applause lines that he had this evening were when he said, surplus, try a tax cut, deficit too high, try another, feel a cold coming on, take two tax cuts, roll back regulation and call me in the morning in reference to the republicans. it didn't seem like a speech that well received by the audience. >> no, that's not the case, brian. it was extremely well received here in the hall. and i can imagine it will be extremely well received by the people that president obama was trying to reach in this election. he was fighting against two different deficits. one was an enthusiasm deficit, a disappointment that people were feeling. he took that on by saying he still has hope and he put it to voters out there to say, you can choose the future for america that i'm articulating. he talked a at the end right as he closed the speech about it being a longer path, a difficult path. asked the american people to stick with him. he was describing the ways in which he wants to invest in

education, in science, in innovation. touched on some of the points you mentioned about taxes. i do think he intends to pursue some form of a grand bargain after this election. he alluded to that. but this is a speech that was president obama communicating with both voters and his base. i think it went over very, very well. >> john, you have his base there. seems biden got louder applause. maybe the audio was turned down on this -- >> i think that was an audio problem. >> either way, either way, john, romney was criticized loudly for being light on substantive policy. what did we hear from specifics from the president tonight? i'm going through the speech. i'm not seeing specifics. >> not much, not much. this was a -- this was like mitt romney, he made an illusion to a series of goals. he did not say the specifics, and his people just like mitt romney's people last week made the point, not in the state of

the union address, not a policy address. this is vision. that's what barack obama was trying to put out. >> i think people on the floor, the delegates on the floor of these conventions will eat this up. look, you can see that. there's no question in my mind. whether it attracts independents, centrists, quite another thing. i just want to say this, that what obama seems to be saying, once again, we heard this in biden, obama repeated this. raising taxes on the rich people are going to help get the deficit down. then he goes into a long laundry list of governmental programs. including education and student loans and expanded health care. this is the big government model. these are promises that government cannot afford. these are promises he makes time and time again without anybody there to pay for them. and he mocks tax cuts even though bowles/simpson has tax reform. he mocks regulations even though so many people want to lift the regulatory burden. he mocks the oil companies. i mean, i don't see anything new here whatsoever.

it's the same old speech. and i don't think it's going to resonate and i don't think it's going to expand his base, to be perfectly honest. >> all right. let's get reaction to president obama's speech from former hewlett-packard ceo and cnbc contributor carly fiorina. we're also rejoined by greg valiare. carly, thank you very much for joining us. you've had a hectic day already. your thoughts on the president's speech. >> well, i think we knew before he started speaking that he is a good and sincere man. i think we knew that he is an eloquent and passionate speaker. i appreciate, as i always do when he speaks, the way he talks about our troops, the way he highlights individual americans and everything they've done. but honestly, i have to say, where was the beef in this speech? it was, from my point of view, a purely emotional appeal. it was empty calories. there was no nutritional value, i think. there were no specifics. he presented a set of false choices to voters based on caricaturing his opposition.

or demonizing or demagoguing his opposition. honestly, i really was quite surprised by the lack of specificity and the lack of beef in this speech. >> all right, greg, the lack of beef in this speech. what's your take, buddy? >> i don't think that was the intent, larry. i have to say on a scale of 1 to 10 i would give the speech an 11. brian, with all due respect, man, i don't know what speech you were listening to. this was a phenomenal piece of propaganda. there is no question in my mind that by monday obama will be leading and leading by a few points. >> why do you say that, greg? i want to go back on you to that. to larry's point, there's not much in here we haven't heard before. certainly. there weren't a lot of specifics. it was a slight mention to the automobile bailout. i was a little surprised to hear about opening more federal lands to drilling for natural gas. what in here wowed you, greg? >> his biggest weakness, i thought all along, and the poll taker peter hart at "the wall street journal" has written

about this is the so-called enthusiasm gap. the enthusiasm is back among the base. he's reignited it by this speech. >> carly, let me go back to this. all right. greg takes a different view and i respect that. but what i heard, still, was a lot of governmental programs. this whole idea that we're all in it together. what he calls citizenship. i just put the word "government" in there and i see more spending promises that we will never keep. that we cannot afford. and even though he continues to want to raise taxes on rich people, okay, i'm not surprised at that, there's not enough money to pay for all these promises and, of course, it would do some damage to the economy. did you hear a different message? was there a small government deregulation pro-growth message in there? >> well, first of all, let's just accept that, you know, his views are different, perhaps, than mine and certainly than yours. let's accept the point greg just made which is this was good politics to infuse the base. i accept that. but here's amazingly what we

didn't hear. we didn't hear a goal about job creation. we didn't hear a goal about deficit reduction. we didn't hear any goals or plans or specifics or commitments about the things that we know undecided voters are worried about. where is my job ma? what are we going to do about this historic deficit? poverty is at a 50-year high. small business creation is at a 40-year low. our nation has gone from number one in global competitiveness to number seven. these are bad statistics, and he didn't talk about a single one of them. there is no plan. so he got the base fired up, but the people who don't know how they're going to vote who are going to decide this election, i don't think this speech did anything for them because here's what people have figured out in the last few years. speeches are pretty. you can deliver a passionate speech. that doesn't mean you're going to deliver results. and i think people now are looking for results. >> speeches are pretty, carly,

well said. politics can be ugly. greg, one thing i liked in the speech was this. "i'm still eager to reach an agreement based on the principles of my bipartisan debt commission." so he's extending a hand -- >> well, i mentioned that. >> i know, but he doesn't say anything. he doesn't make a commitment, greg. >> i think you're right, larry. >> what he's willing to give up to get that olive branch. >> greg, with respect, he's always said this, the principles of bowles/simpson, then when it comes to push versus shove, he walks away from it. >> larry, you're wrong about that. >> john, i'm not wrong about that. >> hold on a second. listen. listen. barack obama and paul ryan both proposed the same am of deficit reduction over ten years. $4 trillion. they proposed different ways of achieving it. the president calls for less spending cuts, some revenues. paul ryan is doing it without any tax revenues. they're proposing the same amount of deficit reduction, and the way in which they're different, that is to say that

president obama relying on some tax cuts mirrors what the principles of bowles/simpsons are. what was bowles/simpson? spending cuts and tax increases. republicans have not embraced that formula. >> my biggest beef, look, ryan has tremendous spending reduction. they're not cuts. most of them are just a lower growth rate of spending, putting this massive budget back to about 2007 or 2008 where it belonged. but obama keeps making fun of the tax reform that was in simpson/bowles which is virtually the same tax reform in ryan. as long as on to that view, he can't possibly negotiate simpson/bowles. i'm skeptical. i'd love to see him do it, john. i'm skeptical. >> i have one question about simpson/bowles. if president obama says tonight he's embracing the principles of simpson/bowles, where was he years ago when he could have endorsed that plan and through

his leadership accomplish that plan where we could have reduced deficits earlier? >> carly, he almost negotiated that deal -- no, no, no, he -- president obama -- >> what do you mean no, no, no? >> because you're wrong. okay? president obama and john boehner, president obama and john boehner came very, very close to achieving a deal on the basis of simpson/bowles. they almost did it, but there was resistance among republicans in the congress to any more revenue so the deal didn't happen. so to say he hasn't embraced it, no, he did not embrace all the specifics. nobody has, not mitt romney, not paul ryan who voted against it. they almost negotiated a deal. >> go ahead, greg. >> can i make one point? >> please do. >> i think carly is right. carly is right. there are a lot of issues that should have been addressed and weren't. there's three more forums to address them. there are debates in october. romney still has a chance.

i think romney goes into october now as the underdog. >> well, look, let's be honest. this is a great -- >> i think obama let mitt off the hook. because mitt was light on policy details. mitt was light on economic growth details. and it annoyed me and i've expressed that annoyance to them. but i think obama let him off the hook because he was just as light. >> let's not forget the president made a reference to fdr which may be appropriate because if he is re-elected, he will be the first president since fdr to be re-elected with an unemployment rate greater than 7.2%. reagan had it at 7.2%. all right. thank you. well, the president has now spoken. did he hit the right notes on the economy? did he hit any notes on the economy? let's bring back in rick santelli and jina sanchez. jina, before we get to that, right, which larry's been talking about all night, i just reread the speech. i don't see anything in here

about job creation -- >> or growth. >> well, it makes me nervous about tomorrow's jobs numbers. >> well, i don't think there are too many people who are nervous about tomorrow's job number. i would say that he was certainly light on specifics, but i would agree with the previous comment that this really wasn't the venue for that nor do i think it was the purpose of the speech. i think that what he was trying to do was to reach out and to hit certain -- he actually did hit quite a bit of long-term growth concepts like education, which is one of the biggest factors in changing the trajectory of an economy. and also the idea that what we're doing in this plan and the reason it is taking so long is because, you know, you're talking about stopping the self-reinforcing cycles. when you start to get into a crisis where you see firings and then you see income loss and then you see consumption drop then you see more firings and income loss and consumption loss. that is exactly the kind of dynamic that the policies are

trying to address. and it's a larger government. yes. i'm not necessarily for that, myself, personally, but i would say that it probably was warranted and so i think making the fdr comment is probably exactly what he needed to do to establish himself that this has a goal. >> let me go to rick santelli. rick, with regard to president obama's speech, did you hear any deficit reduction, any debt reduction, any spending reduction, any smaller government? what am i missing here? you tell any. >> you're not missing anything, larry. even if you try to look into the grandiose comments as substance, all the things he referred to when he talked about banks breaking rules were the convictions. when he talks about energy policy, not giving energy companies any more loopholes, the first two years he could have passed anything. he could have changed the tax code. you brought up citizenshipsh. we could have had an immigration plan, energy policy. he could have done anything the

first two years. he picked health care. he didn't worry about jobs or deficits until after the midterms. >> that's not correct. he tried to get an energy bill and he failed. >> they gave us no substance to give him another invite for four more years. >> rick, hold on a second. you're wrong about he could have passed anything. he tried to pass an energy bill, and he failed. he couldn't get it done. >> you mean cap and trade, john. >> that is correct. >> cap and trade is an energy bill, an energy killing bill. >> john, to your previous -- let's not forget the woodward book that guests van hollen, a democrat saying he can't get anything done in the white house. i'm sure that will come back up. i want to ask about the issue rick brought up, john. are you surprised the president didn't play a little more to the base and talk about why isn't anybody that committed crimes on wall street in jail? why didn't he get tougher on that angle? >> reporter: well, i don't think the president believes that he's got a castle full of slam-dunk

cases against wall street executives to prosecute. so i think what the president's spoken about is things that may not have been illegal but that he felt were wrong. >> so he just likes taking slaps at wall street. >> reporter: i think he likes taking slaps at a system that he thought and many americans think wasn't working very well for them. >> well, rick santelli, let me go back. what about the issue of jobs and growth? what did you hear from that on mr. obama's speech? >> i heard nothing. at the end of the day, i heard what sounded to me more like a european-style speech. he basically talked about a lot more entitlements and even though he stressed personal responsibility, i didn't really hear any substance there. everything he is worried about gets fixed if more people get jobs and the road to build those jobs, he didn't -- he not only had no blueprints, he didn't even have a general plan to dig out the trench to start building that road. >> all right. let's get more reaction from our money politics panel. thank you, everybody. we are rejoined now by tony fratto and jared bernstein.

jared, i did like the comment about education. first person in my family to go to college right out of high school is myself. it is the key. however, i would have also liked to have heard him say something about job training, who does that, should corporate america pay for that? where does the money come from? what do we do about the million-plus kids who drop out of high school every year? >> i think those are fair points, but i think where he went with that is a place that larry explic pli-polic pliplicid one i explicitly did. he talked about this issue, he said government has a role in this. that was not only an encapsulation of the speech but a signal the kind of things, brian, you just were talking about are very much within the purview of government to do something about and i think it's also a stark contrast with the other side who constantly talks about government doesn't have a role. in fact, you hear very much larry kudlow's wrap tonight. i want to see much less government. i agree with larry.

you didn't hear that in this speech, but what you did hear is in the area of manufacturing, energy, education, national security, deficit reduction. there is a role for government. >> what i didn't hear -- >> doesn't have to be big government. >> with all respect, tony fratto, what i didn't hear is anything about free enterprise. there was one sentence in there about entrepreneurship. you know what, tony, the government spending as a share of the economy has gone from 20% to 25%. and some people estimate it's going to go a lot higher. and i heard it go higher under mr. obama's speech today. i want to get your take on that, because i happen to think government is too large and has grown far too large under president obama. >> yeah, and i'm afraid that the way that democrats and president obama tonight are talking about this issue of what the role of government is is that any effort to talk about reform or reducing the size of government in any way is treated as, you know, a return to, you know, potterville, you know, that's what you must want to do is

throw kids out on the street and grandmother off of health care, if you want to do any kind of reform at all or shrink the role of government at all in any way. and, you know, we think about, like, where the economy is today. you talk about the percentage of it today. we have to remember that this economy today is being largely underpinned still by fiscal stimulus, large role for the government on the fiscal side in monetary stimulus right now. and what the president's saying is he wants that to continue for an indeterminate period forward under his stewardship but no new plans for what that would look like and what that would do. after the criticism of governor romney's speech last week, i really looked to this speech to be surprise. in fact, i was worried i was going to be surprised by some new policies in here. there's not a single new policy in here. the only specific policy is we want to tax rich people. >> he left, you know, i think this is an odd political thing, john harwood, i'll go to you on this. i think because president obama

did not have any new specifics, to me it was the same old-same old. he actually let mitt romney off the hook because romney didn't have a whole lot to say about the economy and you recall in tampa i acknowledged that. now i think obama missed his chance, let romney off the hook. >> yeah, but larry, you got to look at the goals that both these politicians, mitt romney last week, and barack obama have in the speech. mitt romney was not trying to lay out a policy agenda. he's trying to run against the obama economy. but what's been weighing him down, people don't have a high regard for him personally. the goal of his speech was to make people feel better about him. he hasn't moved the ballot very much. he has increased his favorables somewhat. barack obama -- >> john, i'm sorry -- >> reporter: barack obama was -- sorry? >> seeing some moving of the goal post for romney on that speech because going in, you're right, right? that was the goal of the speech was to talk about himself. and not about specific policies. >> jared, jared -- >> reporter: that's exactly

right. my point about obama was, what obama needs to do is make people who are disappointed in his presidency believe in him enough to turn out and that's what the hope -- >> let's take the president's advice and move this forward in the time we have left. jared bernstein, former white house insider. we still have two months until the actual election. hard to believe. how ugly do the next two months get? >> well, i think it's steady as she goes. i mean, i guess the -- the guestimate for tomorrow's jobs, 125,000, we might do a little bit north of that. >> i mean the political rhetoric. how bad does it go? how low do each candidate go? >> you know -- >> are we talking submarines here? >> it can't get any lower. it can't get any lower. >> i kind of agree with that. look, i actually think -- i very much disagree with this kind of theme about specifics. i don't think you're going to hear a state of the union address here. i think you're going to hear a set of goals.

what i didn't hear from mitt romney, i think tony's remarks actually amplify this, were a set of goals in the economy. what we heard was a lot about him. what we heard from the president wases a set of goals on manufacturing, on education, on energy, on infrastructure, on national security, on deficit e reducti reduction. that's precisely what he had to hit and hit it hard. >> gentlemen, thank you all. jina, if you're out there listening, thank you as well. folks, that's all for tonight. john harwood in charlotte. larry, real pleasure. we're back tomorrow 4:00 a.m. on cnbc for "worldwide exchange." be sure to tune into "squawk box" tomorrow 6:00 a.m. eastern. complete coverage. you have the jobs report, you have kernan's comments, larry and i are going to get some sleep. have a good night, everybody. see you tomorrow morning.

i'm jim cramer. welcome to my world. >> you need to get in the game. >> firms are going to go out of business, and he's nuts. they're nuts. they know nothing. >> i always like to say there's a bull market somewhere. >> "mad money," you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i just want more days like today. my job isn't just to entertain but to teach you. call me at 1-800-743-cnbc. this business of stocks isn't politics. it's not like a presidential campaign where each candidate tries to explain why you might be better or worse off than you were four years ago. no.

today's rally where the dow rocketed 245 points, the s&p rose 2.04%, and the nasdaq vaulted 2.17% is about something different. it's about asking whether companies are better off than they were four years ago, not you. because those are the old stock prices we are now challenging with this amazing run. the stock prices of companies now versus then. are they better off? this vast difference between politics and profits confuses more of you than just about anything else i know. we all know people who are hurting. there is not a lot of hiring going on. four years ago we had 5% unemployment. now we have 8%. hey, that's a front and center election issue. i'm sure a lot of people aren't better off than they were four years ago because of this very tough job market. that's not what's at stake when it comes to our stocks.

we are not investing in whether you find it easy or hard to get a job. we are not investing in your ability or inability to get a loan. we are not investing in homes, many which are nowhere near the prices they were four years ago. we aren't investing in the hideous size of the national debt. most important, we are not investing in the government of the president or the potential government of the challenger. nope. we're investing in the present and future fortunes of individual companies. if you ask me, as far as companies are concerned, both the present and the future are a lot brighter than they were four years ago. that's why we are having a fabulous rally back to the old highs. why are the issues of politics so divorced from the issue of profits? why the heck do i think things are better off at so many companies even as they might be worse off for you? first, what's good for business

might be bad in politics, as mitt romney has brutally learned about his time with bain capital. so many companies are doing well in part because they are getting more out of each worker and not hiring. if you're looking for a job or you are a democrat running for re-election, you want to give people hope and you want companies to do the right thing by potential employees like hiring. if you're a shareholder in a company you want to create and sell more high quality product for less money. that's what you want your company to do. create and sell better product, less money. you want the highest gross margins which means you want cheap labor, fewer expensive new hires, especially with the new onerous health care costs and robust sales augmented via technology. think better software, stronger customer relations, rather than more costly salespeople and the assistants and the health care that takes. in other words, stockholders want the exact opposite of what an incumbent president might

want. and what an unemployed person definitely needs. suffice it to say a huge number of the companies i follow have fewer employees than four years ago and bigger sales. that's producing far more bountiful profits than you'd expect which is the correct explanation for this broad near record-breaking advance. in politics we really don't care about how other countries are doing it. they don't vote. when it comes to profits, we care tremendously. that's why when the european central bank agreed this morning to do what we hoped, buying bonds of countries that are having a hard time hawking them, people came off the sidelines in this country to invest in our stocks that have stakes in europe. even if the politicians have no skin in the game. if europe can avoid financial catastrophe then the outlook for many companies that do business over there improves dramatically. of course if we have a lehman-like event in europe the politicians can take pride it

happened over there this time, not over here. if you're an international consumer packaged goods company, a far flung industrial, a global financial company or worldwide tech company you care about europe as much as the u.s. the european central bank's unified position among germany and the weaker countries, i'm calling it most heartening. your sales might rise, your earnings might gain. especially because a weak euro is hurting your profits when they translate to strong dollars. just the opposite might soon occur if this euro rally we're having right now has staying power. i'm not minimizing the nonfarm payroll employment tomorrow. it will play a role in how stocks trade. in fact, it might already be playing a role because we had precursors today. weekly jobless claim figures. they're all pointing to a decent number tomorrow. there is an intersection between plux and business right there that can matter to both politicians and traders. but investors? if you wanted some of the biggest gains these last four years, you'd invest in retailers

and retail suppliers which have been terrific as you'll hear from calvin klein and tommy hilfiger parent pvh later tonight. if you looked at the friday numbers at the beginning of the month they missed the big wins. some of the market is counterintuitive. as the ceo of pvh said today he often didn't have enough product in the stores to meet demand because he was fearful of getting stuck with too much inventory giving the gloomy state of the consumer. now he's letting the daytona, not the downbeat headlines determining his merchandise level. and the company is more lucrative than ever. an analog for many successful retailers. judging by the rallies to new highs we believe the performance doesn't correlate as much with the labor department numbers as we thought. the increased retail strength might have to do with delayed spending. people held off for as long as they could, or believed it might be worth sprucing up the home as it is, at last, becoming more valuable. that is how stanley, black & decker fell five points on a

simple brokerage upgrade or williams-sonoma and pier 1 could again hit new highs. plus the bad news is good news component exists in the stock business but not in politics. hey, in politics, bad news is -- bad news. it hurts you in the polls, in your re-election chances. but in business bad news means unelected central bankers might have to do something positive, something creative to turn bad news now into good news down the line. we are seeing the bad news to good news story playing out everywhere whether it be federal express. remember that? now almost back where it was five days ago. or caterpillar. those need the chinese economy to do better. china can improve its rapid interest rate cuts. here's the bottom line. the bottom line is you should not be voting on stocks based on whether you are personally better off. you should be investing in stocks because the businesses behind them might be better off. and using that prism, stocks not only have a right to have gotten

this high, they actually have the ability to even go higher over time. >> don't miss a second of "mad money." follow @jim cramer an twitter. have a question? tweet jim cramer #madtweets. send jim an e-mail to madmoney@cnbc.com or give us a call. at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com. you know why i sell tools? tools are uncomplicated. nothing complicated about a pair of 10 inch hose clamp pliers. you know what's complicated? shipping. shipping's complicated. not really. with priority mail flat rate boxes from the postal service shipping's easy. if it fits, it ships anywhere in the country for a low flat rate.

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fashion week in new york city kicks off tonight and what a night for it. the market was smoking. given how retail stocks have been on fire, we want to take a closer in-depth look at the hottest best performing apparel plays, pvh, and calvin klein and tommy hilfiger among others. the stock to hit its 52-week high despite the gloomy economic news out there. this company isn't just ubiquitous. it's got style. retails, business many management matters more than usual. you need a ceo with an eye for fashion. the ceo, how great is this guy?

pvh's quarter at the end of august was terrific including stellar numbers in europe of all places. double-digit tommy hilfiger. the stock has given you about 140% gain since i first got behind it in 2008 and up 22% since the first time we spoke to manny on may 23rd. earlier today we went to the flagship tommy hilfiger store in manhattan because tommy is the real growth driver here and abroad to talk to the bankable ceo of pvh about how his company is doing and where it's headed. check it out. manny, thanks for inviting us to the most exciting store i've ever been to. tommy hilfiger. the story about the new wrinkle. men like to shop in men's stores. it's the kickoff of fashion week. give me a sense of why this store works for you. >> this store, we're sitting in the tommy hilfiger global retail store that's our flagship store for the brand around the world.

it's our largest store, almost 25,000 square feet. and we really communicate with the american consumer here and also as you can imagine we're in the middle of 5th avenue and 55th street. tremendous amount of international tourism goes through here. the store is nonstop all the time. we show the best of what tommy hilfiger stands for as a brand. >> you start with international. i think almost everyone is so used to hearing how terrible it is in europe. how terrible. you come on and this is one of the reasons why this stock is 52-week high. just talk about europe as if it's booming. >> look, the brand is very strong in europe. especially in northern europe where we have such a core strength there. we posted 10% revenues growth this year. 15% comp store growth in europe. yeah. we are outperforming. we are gaining significant market share in a very tough market. now, we're feeling it like everyone else. that consumer is under more

pressure, and the uncertainty that's being built in europe clearly is an obstacle that we are overcoming, but it's also creating great market share opportunities for us as we continue to garner market share in a tough market. >> one thing i love about manny is you have up to date information. back to school, a lot of guys are worried. in the conference calls you don't sound worried. >> we are off to a strong start in the third quarter. the month of august, comps for calvin klein and tommy hilfiger were in the high single digit range. our comps in europe for the tommy hilfiger brand continued in the low teens. >> incredible. >> heritage businesses continue in the 1% to 2% range. very strong start to the season. very strong start with the key retail partners, macy's, jc penney and kohl's. >> jcpenney, people worried perhaps they're not doing that well. on your conference call, you made it pretty clear that the stores within stores are really fantastic for what you -- for your future. >> you know, we think it's -- it's a great way to showcase our brands.

we've seen early results. i am talking about very early, jim. we're talking about ten days of worth of sales so far. the transition and transformation he's taking that company through. truly he's been very upfront about some of the rocky issues he's had to deal with. i think they have a clear path, they understand what they need to be successful and we're being as supportive as we can with them, not only with izod but with our brands there and we're a big part of their dress furnishings brand as well. >> you're big at macy's. jcpenney, we don't know yet. there's a lot of criticism about what he's doing. numbers are down a bit. >> absolutely. macy's put together the last three years just great results. terry lungren and his team have just continued to hit the ball

out of the park and we've been beneficiary with that, with our two key brands, tommy hilfiger and calvin klein brand. we're benefiting by their great execution and i'd like to think we're a real significant part of their success as well. >> and inventory's lean. >> inventory is very lean not only on our balance sheet but in the channel. key retail partners like macy's and kohl's and pennys have kept their inventories lean. it gives me confidence not only about our business but retail in general as we go forward. >> now, you have taken a lot of that money, because you're making a big profit. you've been paying down debt. talk about paying back $1 billion. and it may be time for another acquisition. the hilfiger acquisition was clearly incredible. you talk about how the areas of weakness are jeans and underwear. that's something you licensed. you talked about how in the conference call you want to

start owning brands. warneco, $2 billion company. is it time to make it more than just a licensure? i always try to get you to break news. you've broken news on our show many times. >> we're not going to breaking any news tonight. >> clearly, look, warneco is a great strategic partner for us. we're happy the way they operate the business. we work together really well. their underwear business continues to be very much on fire. and we're in a non-denim cycle and they're struggling through some issues particularly in europe with the calvin klein jeans business there. i think, put that business to the side, the rest of the calvin klein portfolio is growing 12% to 15%. so when you bundle it all together, the calvin business in the third quarter, our royalty revenues are up over 7%. so still very healthy growth. and i think warnaco clearly put the measure s in place to get te business back on track. >> manny, i want to thank you for making one of the best

performing stocks we've ever recommended on "mad money." i thank you for what you've delivered. it's been a remarkable performance. >> thanks so much, jim. good to see you. >> thank you, that's manny, chairman and ceo of pvh corp. [ female announcer ] want to spend less and retire with more?

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i would absolutely love to own a football team. i think pretty much anybody would. i'm not sure i want to be a shareholder of a football team. and that's what i need to warn you about tonight. now, there aren't any big american sports franchises that are publicly traded. but last month, manchester united, manu, the most popular team in england, that's european football, or soccer as we call it in cay macramericcramerica, public offering in the united states. i have to give this deal a red card. i wish i could come out and tell you manchester united is a buy. that would make me feel terrific. we don't go for soccer in america. even though i coached the game for years and was team captain in high school. this is the type of company that has the potential to get people excited about socks. one of the people on the women's soccer team, the gold medalist,

said, look, i want to own shares in this. made me cringe. manchester united is to soccer in england to what the yankees are to baseball here in america. this is the team that made david beckham famous. it's an incredibly powerful global brand. 659 million fans all over the world. although very few of them are in this country. the bulls are arguing that manchester united is not just a soccer team, it's a mini media empire. making its money not just from selling tickets but from broadcasting because you know the games can't be recorded. people want to watch them live for merchandising, and from sponsorship deals. ing on the surface that sounds like a compelling argument, doesn't it? man u. seems like a real cool stock which is all the more reason to put manchester united in the -- sell, sell, sell. -- sell block. i can't allow you to be seduced by the allure of owning

something cool when the actual underlying business model really isn't all that good. you can be a fan of manchester united. go right ahead. you do not want to be a shareholder in manchester united. why not? first of all, you could tell something wasn't right, something wasn't quite right from day one. when man u. became public back on august 10th, stock didn't even pop. deal priced at 14 a share. went out at 14 a share. that's pretty odd. the average ipo has had a first-day pop of 14%. this tells you man u. was either priced too high or the big or big institutional investors who do the buying in the ipos didn't find a reason to get excited about this one. which was it? probably a bit of both. stocks come down. 8% decline. man u. is still priced for perfection. this thing trades for 38 times earnings. that's a sky-high multiple. even if you buy the argument that this is a global mega brand. this stock should sell for a fraction of that price to earnings multiple.

over the last five years manchester united increased the growth rate. and the company's adjusted earnings before taxes, amortization, have grown at an 11% compound annual clip. i'm sorry. those numbers are still nowhere near high enough to justify paying 38 times earnings. our rule, over two times, you're stretching it. two times the growth rate. this is considered a stretch. of course man u.'s future is looking brighter than the past thanks to rapid growth from the broadcasting segment. at this valuation, i think those positives are baked into the share prices. however, there are also a lot of negatives and they're not baked in. this is a stock that's priced for perfection. the company, itself, have very far from being perfect. the bulls may argue manchester united transformed itself into a global entertainment brand, at the end of the day when you buy the stock you're making a sophisticated bet on a soccer team. if you're going to do that, bet on the darn game. it's more fun and easier to understand what you're putting your money on. i'm serious.

not serious about anything illegal. that's betting. i'm serious about avoiding the stock. manchester united gets a third of its revenues for selling tickets to games or matches as they're called in soccer as well as selling foods and drinks to the people that show up. the problem is if the team hassed has bad year, have a few key injuries and get knocked out before the finals, they're not going to play as many games and adds volatility to the business model. last fiscal year manchester united got knocked out of the european champion's league early causing to decline by 3.5% and adjusted earnings before taxes and amortization to fall by 17.5% for the year. much rather earn a share in the nfl if they became public. too much of the stock's performance rides on the team's performance. manchester united is generally a fabulous soccer club. if you're going to own the stock, you just don't need to be able to handicap business but be able to handicap the sport. do homework on the team and every team may might be facing as well as the company. that's a lot of work if you

aren't already a huge soccer fan. even if you love, love, love soccer to the point where you're offended i'm not calling it football, you shouldn't own manchester united for simple business reasons. there are no restrictions on player wages in european football which means man u. could face serious labor costs down the line. manchester united's balance sheet, stinker, loaded down with high levels of debt. company has a dual class share structure. means regular shareholders like you have no say on important business decisions. all the power remains with the family which owns 75.8% of the equity. they own the class b. super voting class. i hate these dual class structures. that makes it so management is simply not accountable to regular share older. plus you better believe the family might sell more stock. when the lockup period expires somebody could send the stock lower. why not? it doesn't control any votes. it doesn't control the company. bottom line, go ahead and play soccer. be a fan of manchester united.

were their jersey. but please, i'm begging you, i don't want you to own a share of manchester united. you've done your homework. you're ready to buy. how do you know when to buy? just ask cramer. "mad money," weeknights on cnbc. like i say there's always a bull market somewhere. promise to find it just for you right here on "mad money." i'm jim cramer. see you tomorrow. we're sitting on a bunch of shale gas. there's natural gas under my town. it's a game changer. ♪ it means cleaner, cheaper american-made energy. but we've got to be careful how we get it. design the wells to be safe. thousands of jobs.

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